Income is a major driver of avoidable hospitalizations across New Jersey

July 30, 2014

The household income of its residents is the most important factor in whether a community has high or low rates of avoidable hospital visits – conditions that could be better managed in a doctor's office or other health care settings if treated at an early stage, according to a report released today by the Rutgers Center for State Health Policy (CSHP).

An analysis of hospital billing records and demographic data by Rutgers researchers across 13 low-income communities in New Jersey found that as an area's per capita income rises, the number of patients who seek medical care in the hospital falls dramatically. Specifically, a 1 percent increase in local area per capita income was associated with a 0.85 percent decrease in avoidable hospitalizations.

The Rutgers team also discovered that hospital systems in some low-income areas perform better than one would expect given their per capita income and other socioeconomic disadvantages.

For example, Camden, an area that is known for high rates of avoidable hospital visits, performs better than expected after statistically adjusting for the city's high level of socioeconomic disadvantage, according to the researchers. In contrast, high rates of avoidable visits in Jersey City and Asbury Park changed little after socioeconomic adjustments. This suggests that avoidable hospitalizations in these places are most likely related to factors other than income – such as the lack of access to primary care doctors.

The report – funded by The Nicholson Foundation as part of its ongoing effort to improve the quality and affordability of health care in New Jersey's underserved communities – can help policymakers and health care providers understand variations in hospital use so they can design strategies to limit avoidable hospitalizations.

"The findings show how well a hospital system can perform in the face of poverty," said Rachel Cahill, director of improvement and transformation at The Nicholson Foundation. "The fact that some low-income areas are performing well despite their dire situations indicates that there is great potential for improvement."

The report, Cahill says, has important policy implications as New Jersey begins to implement its three-year Medicaid Accountable Care Organization (ACO) pilot, a demonstration project to improve the quality and affordability of care in low-income regions. Medicaid ACOs assume responsibility for coordinating the care of Medicaid beneficiaries within a geographic region and share savings accrued from improved care delivery and reductions of costly medical episodes.

"In many low-income communities, lowering avoidable hospital use and cost requires emphasis on the social determinants of health," said the report's lead author Derek DeLia, associate research professor at the CSHP. "This is especially true in communities that perform better than expected after adjusting for socioeconomic factors. In these communities, interventions that give special consideration to the daily stresses and problems associated with poverty – such as unsafe neighborhoods, unstable housing, lack of transportation, or limited access to healthy foods – can play a greater role in improving health and reducing avoidable medical episodes than a purely focus."

The researchers used data from hospital administrative records and the U.S. Census Bureau to calculate rates of unnecessary hospital visits for all New Jersey ZIP codes from 2008 to 2010. They looked at the records of patients with conditions such as asthma, pneumonia, chronic pulmonary obstructive disease and congestive heart failure because these are conditions for which hospitalization is often preventable when access to primary care is adequate.

The statistical analysis that tied income to hospitalizations held even after accounting for such social indicators as widespread unemployment or illiteracy, and characteristics of local hospitals, including the number of available beds.

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